Gifts, big and small, can have an impact on how we feel and what we do. We all know it. When your co-worker unexpectedly gives you a holiday box of chocolates, you feel guilty and petty about snubbing him because he stole your stapler.

And no one knows more about using gifts to win people’s hearts than the drug industry. In what may be a surprise to many patients, the majority of doctors accept some kind of payment, gift, drug samples, meal, or other gift from the drug industry. These range from the free lunches delivered to their hard-working office staff, to hundreds of thousands of dollars in consulting or speaking fees. A 2009 survey found that 84 percent of doctors had some interaction with a drug company that involved payment, gifts, travel, consultancy or speaking fees, drug samples, or other reimbursements or payments.

While some exchanges, like samples or legitimate research are generally appropriate, other relationships are problematic. And some of these relationships have landed drug companies in hot water, leading to over seven billion dollars in settlements with the federal government over the last four years. For instance, Allegan, the manufacturer of Botox, created phony advisory boards “to reward hundreds of [the drug’]s top injectors,” according to a federal prosecution settled for $600M in 2010. How did 200 of these physicians ‘advise’ Allergan? By flying an oceanfront resort in Newport Beach, California in 2005 and 2006, and getting paid $1,500 to listen to presentations on unapproved, off-label uses of Botox. But Allergan is not alone. Forest labs paid doctors $1,000 for letting a salesman follow them around all day, while prompting the doctor to prescribe Forest’s anti-depressants Celexa and Lexapro. A Forest subsidiary pleaded guilty to one felony and two misdemeanors, and Forest paid the feds a $313 million settlement. Other examples  abound.

So last week,  the Centers for Medicare and Medicaid Services (CMS) gave patients, consumers, and others a different kind of gift – strong draft regulations on public disclosure and transparency of drug and device industry payments and gifts to doctors to implement the Physician Payments Sunshine Law, the ground-breaking transparency law passed in 2010 as part of the Affordable Care Act. This law will allow anyone to see when and how much their doctor is being paid or given gifts by the drug companies.

The scope of what drug companies must report – any “payment or transfer of value” – is  very broad, and will include nearly anything that has any value: a coffee mug, pens, dinner at a nice restaurant, or a big consulting contract. But the law allows for a number of exceptions: drug samples, educational materials for patients, and small items under $10 in value, so long as the total value in a calendar year doesn’t add up to more than $100.

But when a drug maker doesn’t make a payment directly and the money goes through a third party, to a doctor or hospital, what happens? 

Under the law, the payment is not reported if the drug manufacturer is unaware of the identity of the doctor or teaching hospital that receives the payment made indirectly via a third party. This is potentially a significant loophole that could encourage pharma to simply farm-out their gift-giving to marketing firms, etc. and attempt to sidestep the public transparency purpose of the law.

The good news is CMS wants to narrow this loophole as much as possible, and has proposed a strong standard to prevent the loophole from undermining the law. The draft rule has defined being “unaware” of a doctor’s identity to be when the manufacturer does not actually “know . . . the identity of the covered recipient,” so long as the manufacturer has not tried to act in “deliberate ignorance”  or “reckless disregard” of learning the identity doctors or hospitals that received payments from them via a third party. So a drug company cannot simply turn a blind eye to where their funds are being distributed by third parties.

CMS has further advised that if the names of the recipients are ‘publicly available,’ then the manufacturer is deemed to know the identity and must report these payments. Similarly, if an “agent” of the manufacturer, such as a staff member, employee, or paid consultant knows these identities, then the manufacturer must report.

How might this work? Well, if Pfizer paid a medical education company to pay for the travel and registration costs for all the cardiologists at a state university medical school, Pfizer would need to report these payments. Similarly, if Merck paid an event planner a lump sum that was intended to cover the travel costs of all the doctors presenting at a professional conference, Merck would need to report these transfers of value because the identities of these doctors would be publicly available, or would likely be easily available to conference attendees,

A recent blog by Daniel Carlat looks at how this will affect disclosure of industry payments to continuing medical education companies that then pay doctors to speak.

While there are a lot of details that must be worked out, CMS is setting the stage for broad transparency to bring the financial relationships to light. This is a nice year-end gift for patients, consumers, health plans, and advocates who are eager to know about and better understand the relationship that drugmakers have with their doctors and hospitals.

Wells Wilkinson, Director, Prescription Access Litigation project

Last week Community Catalyst and six California-based senior and consumer groups wrote to the California delegation of the U.S. House in support of a federal system to track the authenticity of prescription drugs.

The letter expressed support for the leadership of Reps. Bilbray (R-CA) and Matheson (D-UT) in sponsoring the Safeguarding America’s Pharmaceuticals Act of 2011 (H.R. 3026). The bill would protect patients from counterfeit and diverted drug products by establishing an FDA mandated national drug identification and tracking system. The letter was signed by the Gray Panthers (statewide and Berkeley-East Bay), the California Alliance of Retired Americans (CARA), Congress of California Seniors, CALPIRG, and CA Citizens for Health Freedom, as well as Community Catalyst.

Prescription drug counterfeiting has become one of the most lucrative crimes in the world. As such, there is no reason not to use modern technology to track the distribution of our vital medications and ensuring that the drug distribution system is secure. The network of businesses that move drugs from manufacturer to the patient is extremely complex, creating opportunities for highly profitable schemes to move stolen or counterfeit drugs into legitimate channels of distribution—and then to patients. These illicit products can be degraded, clinically dangerous, or ineffective, putting patients at risk. For example:

• Cancer and transplant patients were exposed to counterfeit Epogen and generic Procrit in 2002. Criminals netted a profit of $46M and more than 90,000 vials may have reached patients. This was exposed when some patients suffered painful side effects.
• Cancer, cholesterol and other drugs were bought from Medicaid patients on the streets of New York and resold to a wholesaler and then to pharmacies. Two men were convicted in 2008 for the $6.8M scheme.
• Thieves stole 129,000 bottles of insulin in 2009. Stored under unknown conditions, the temperature sensitive drug was sold back to pharmacies and ultimately to diabetics.
• Counterfeit Lipitor™ from Central America was illegally imported and sold into U.S. distribution in 2003.

Drug products move between large wholesalers, smaller wholesalers, large chain drugs stores or small pharmacies. While smaller wholesalers are required to maintain drug ‘pedigrees’ (paper or electronic transaction histories) under federal law, the larger “authorized distributors” of manufacturers are exempt. We need a uniform track and trace system to verify the history of all drugs, throughout each of the distribution channels.

This is of special significance to the state of California, which took the lead on the “pedigree” issue in 2004, when it passed legislation spearheaded by the Board of Pharmacy, CA senior groups and Health System Pharmacists. But the implementation of a state tracking and authentication system was delayed until 2015-17 by subsequent legislation, in order to allow the federal government to create one uniform national system.

Since then, 28 other states have also passed some form of drug pedigree law, but varying provisions make industry compliance complicated and open to abuse. Comprehensive federal legislation like the Safeguarding America’s Pharmaceuticals Act of 2011 (H.R. 3026) would ensure consistency, as well as meet the California legislature’s deadline and goals.

H.R. 3026 would:

• Require manufacturers to place a unique identification number on each package of drugs (the smallest salable unit) bought and sold in the United States.
• Establish an electronic tracking system to allow companies to verify the authenticity of the drugs they buy and sell, and requiring every entity that receives a drug during distribution to perform such authentication.
• Strengthen national guidelines for state wholesaler licensure standards.

Eight years ago, Cesar Arias, a pharmacist and drug inspector for the state of Florida, told congressional investigators:

“No patient in the nation can know with 100 percent certainty that the drugs they are getting are what they are purported to be — or if they are, that they have not been in the trunk of someone’s car, or sitting in a hot warehouse or a crack house in South Florida .”

It is well past time to heed his warning.

– Marcia Hams, Prescription Access and Quality &
Wells Wilkinson, Prescription Access Litigation

Yesterday, the Massachusetts Attorney-General’s office announced a $24 million dollar settlement resulting from an investigation of pricing fraud in state programs by fourteen different drug makers. This settlement follows a ground-breaking national settlement of a lawsuit filed by the Prescription Access Litigation project at Community Catalyst in 2001, with Health Care For All, Mass Senior Action, MassPIRG and eleven other consumer groups nationwide representing the interests of consumers.

Drug industry pricing fraud became widespread in the mid-1990s, when high but fictitious list prices were used as an incentive to sell products. Doctors or pharmacies made more money using a drug whose actual cost was far less than the amount they were paid by Medicare and Medicaid. This fraud led to our class action lawsuit and a ground-breaking 2007 trial on behalf of Massachusetts consumers and private sector insurers. It was found that AstraZeneca, Bristol-Myers Squibb and Warrick (a subsidiary of Schering-Plough, which was bought by Merck in 2009) had violated consumer protection laws through their deceptive pricing tactics. This victory ultimately convinced 28 different drugmakers to pay over $360 million to settle claims with the private sector health plans and consumers. (See more here.)

And now, on behalf of public programs here in Massachusetts, the Attorney-General has recovered funds from a number of these companies for the same kind of unfair and deceptive pricing. For example, manufacturer Warrick sold an albuterol drug from 1995 to 2003, all the while reporting a list price that was nearly seven-times the actual sales price. The State’s trial in 2010 found that Warrick had cost Massachusetts $4,563,328, and had made 28 false statements in violation of the state’s False Claims Act. After treble damages, 12 percent interest, and legal fees, a $24 million settlement looked like a good deal to Warwick’s new owner, Merck.

How can Massachusetts better protect its public programs from deceptive pricing in the future?

Currently, Massachusetts uses industry-published list prices as a basis to reimburse pharmacies. One option is to adopt the Average Acquisition Cost (AAC) method of paying pharmacies for the drugs MassHealth purchases for its members. The AAC method does not use easily manipulated manufacturer “list” prices (at issue in the court case). Instead, pharmacies are paid based on their actual cost of acquiring the drug from the manufacturer, plus a dispensing fee, thereby reducing overpayment and saving money for MassHealth. This evidence-based pricing method has been adopted by Alabama and Oregon, and it has been recommended by Medicaid headquarters in Washington D.C. And like Alabama and Oregon, Massachusetts could make these regularly-audited drug prices available to the public, so that private insurance plans could also adopt this method and save money, hopefully reducing premium costs. Community Catalyst describes more about AAC in its new Medicaid Report Card.

– Wells Wilkinson, Director, Prescription Access Litigaton, and
Marcia Hams, Director of Prescription Access and Quality, Community Catalyst

Yesterday, CMS started to make up for lost time when it issued the draft regulations on the Sunshine law in the Affordable Care Act. This new law requires manufacturers of drugs, medical devices (e.g. stents, replacement knees etc), and biologics to report all payments they make to doctors and teaching hospitals to HHS, which must disclose these payments in a publicly available, on-line searchable database.

In response, Senators Grassley and Kohl cancelled a hearing to explore why CMS had missed an earlier deadline and thus delayed the start of the new transparency program. This was of concern to both consumer advocates eager that these payments become public, and to industry representatives who are concerned about how to comply with the transparency law starting next year.

The delayed release of the new draft rules does mean that industry will not have to record or report payments that are made before the final version of the rule enters into effect, likely no earlier than April or May of next year. CMS is accepting public comment on the draft rules until Feb. 17, 2012. But CMS is standing by the law’s required September, 2013 deadline for disclosing to the public any 2012 payments that are made after the rule is final.

While we are disappointed that the first public transparency reports may not have a full year’s data, we think it is more important to allow CMS adequate time to ensure that the final regulations are as strong and effective as possible. From our point of view, good regulations will help ensure that industry reports payments fully and precisely, so that patients, the public and CMS itself can best understand what these payments are for, and evaluate whether a payment is appropriate.

One highlight of the draft rule was how CMS captured the purpose of the law’s new public transparency program. CMS states that, while industry collaboration can be beneficial, “payments to physicians and teaching hospitals can also introduce conflicts of interest that may influence research, education and clinical decision making in ways that compromise clinical integrity and patient care, and may lead to increased health care costs.”

The on-line database of industry payments, to be made publicly available by Sept. 30, 2013, will include the name and identifying information for the manufacturer making the payment, the doctor or teaching hospital receiving it, the amount of each payment, the drug or device associated with the payment or “transfer of value”, and the form and “nature” of the payment. We were pleased that CMS proposed broadly inclusive definitions of manufacturers, their subsidiaries, and third parties who may make payments on their behalf, although CMS has asked for comment on this definition.

The draft rule also proposed that the categories of payments should be distinct from one another to ensure the utility of the information to patients, to researchers and the public. However, we do have concerns that the final rule will not honor that intent if it does not provide clear definitions on how the categories (such as education, gifts, consulting, etc.) differ from one another. The draft rule as it stands now leaves out clear and specific definitions, which would open the door to varying interpretations by each company, a problem we have already seen in the public disclosures required under court settlements. This results in data that is inconsistent, confusing, and not useful to the public.

Overall the CMS framework is solid and reflects the spirit and intent of the Sunshine law, which was supported not only by consumers but by leaders in the medical profession, the Institute of Medicine, MedPac, and many in industry.

The draft regulations include many thoughtful discussions of reporting issues and invite further comment on many of them— a clear opportunity for consumer advocates concerned about the drug industry’s abuse of financial incentives to doctors or teaching hospitals. We will be submitting our recommendations to address this issue and hope others will as well.

– Marcia Hams, Director of Prescription Access and Quality &
Wells Wilkinson, Staff Attorney

Recently, the Government Accountability Office published a report entitled, “Food and Drug Administration: Better Coordination Could Enhance Efforts to Address Economic Adulteration and Protect Public Health.”

The report describes economic adulteration as follows:

“Economic adulteration is not a new problem and ranges from simple actions, such as adding material to increase a product’s weight, to more sophisticated substitutions or additions that are designed to avoid detection by tests known to be used to authenticate ingredients or products. Economic adulteration differs from other forms of intentional adulteration, such as bioterrorism or sabotage, whose primary purpose is to cause harm.”

Once again, the heparin scandal, the poster child for the vulnerability of the U.S. drug supply, is cited in the report as a prime example of economic adulteration. In 2007-2008, heparin was discovered to contain over-sulfated chondroitin sulfate, a toxic contaminant that mimics heparin. The contamination was evidently economically motivated, and was linked to a number of serious allergic reactions and deaths in the U.S.

Economic adulteration is distinguishable from unintentional violations of current Good Manufacturing Practices, which can also cause a drug to be adulterated. For example, we have seen cases where drugs have been mislabeled, made too strong or too weak, or contaminated with microorganisms, but those problems were a result of poor manufacturing practices, not intentional adulteration with an economic motive. (See, e.g., GlaxoSmithKline statement about its failure to follow cGMP.)

According to the new GAO report, FDA officials and stakeholders cited two main challenges to addressing economic adulteration. The first:

“Globalization has led to an increase in the variety, complexity, and volume of imported food and drugs, which complicates FDA’s task of ensuring their safety. In addition to globalization, an increase in supply chain complexity—the growth in the networks of handlers, suppliers, and middlemen—also complicates FDA’s task.”

This is not the first time globalization has been identified as a problem, but it is a reminder for Congress and the Administration of the challenges facing FDA.

The second problem identified in the report was lack of information from industry. Here, there are two main issues. First, because companies regularly test ingredients from suppliers, they have information on potential adulterations that would be useful to the FDA. However, industry is reluctant to share that information when it does not have to (such as when an adulterated ingredient has entered into commerce) because of fears of exposing themselves to litigation for accusing a supplier of intentionally adulterating products if their findings turn out to be erroneous. Second, FDA would benefit if industry would share more information about what substances might be used to adulterate products. Companies develop tests to monitor products they receive from their suppliers but often are reluctant to share the information with the government because it is proprietary.

These accounts in the report highlight the necessity of involving industry in any solutions to our drug supply safety problems. Fortunately, we have seen a lot of industry support for improving the safety of the drug supply (including the generic industry’s recent agreement with the FDA to pay user fees), and hope the collaborations can continue to improve, as both industry and government will succeed only if they keep the consumer and patient’s safety as the highest priority. But in order to combat economic adulteration (and other forms of drug contamination) and protect the food and drug supply of the U.S., the FDA needs to have the tools and resources necessary to deal with these 21st century concerns.

Additional coverage of the report is available at:

• Pharmalot
• FDA Law Blog
• In-Pharma Technologist

– Anna Dunbar-Hester, Policy Analyst

Late yesterday, thirty advocacy organizations, representing seniors, labor, providers, patient safety advocates, cancer patients, and consumers joined Community Catalyst in calling for Congressional action to improve the safety of drug manufacturing.  In letters to the Senate HELP and House Energy and Commerce committees, groups urged Congress to make safe drug manufacturing legislation a priority by including new patient safeguards “in the upcoming reauthorization of the Prescription Drug User Fee Authorization Act (PDUFA).” 

Signed by advocacy groups from across the nation and in districts of some key Energy and Commerce committee members, the letters warns that the many recent drug recalls, failed inspections, and manufacturing quality breakdowns by both brand-name and generic manufacturers are likely just “the tip of the iceberg” because most manufacturing problems at overseas facilities go unseen.

The high profile manufacturing problems by Johnson and Johnson, GlaxoSmithKline, and other facilities were discovered primarily by FDA visits to the 2,500 domestic drug manufacturing plants, which are inspected once every two and a half years.  But the number of foreign drug manufacturers has doubled in the last seven years, encompassing approximately 3,800 foreign manufacturers in more than 150 countries.  

This rapid globalization of overseas drug manufacturing has far outstripped the FDA’s capacity to inspect these new facilities, which today are the source of 40 percent of finished drug products taken in the U.S., and 80 percent of active drug ingredients and bulk chemicals used to make drugs domestically.  According to the GAO, under current resources, the FDA can inspect these 3,800 foreign sites only once every nine years.

The letters show that these risks are real, serious, and potentially lethal for vulnerable patients. For instance, the intentional contamination of heparin tragically led to numerous deaths and hundreds of adverse reactions amongst the hundreds of thousands of dialysis or post-operative patients treated with Heparin each year.

We also noted how these risks are not floating under the radar, but are widely known by industry leaders. A 2010 poll of pharmaceutical executives identified “raw materials imported from outside the U.S. as the greatest vulnerability” to the purity and integrity of drug products in the next five years. But progress has been made. Our letter commends how the generic drug industry has “stepped up to the plate” by “agreeing to fund inspections with user fees….” See here and here.

Reform is also widely supported by voters from across the political spectrum. In fact “81 percent of Republicans, 87 percent of Independents, and 97 percent of Democrats support increased FDA authority to issue recalls, destroy contaminated products upon import, and inspect foreign manufacturers” according to a recent poll.

The letter asks Congress to provide FDA with new authority to adequately protect US patients from the increasing risks of counterfeit drugs, a leading black-market enterprise around the world. This would include the ability to issue a recall, or to destroy contaminated, expired, or unsafely manufactured drug products that are seized at the border.

Yesterday, Rep. Michael Burgess, vice chairman of the House Energy and Commerce Subcommittee on Health, announced that reforms to end drug shortages would be included in legislation to renew the system of collecting fees from drug-makers in order to fund FDA review of new drug products. We support efforts to eliminate drug shortages, and improvements to drug manufacturing quality would certainly help. According to the FDA, manufacturing problems were the cause of over half of the drug shortages in 2010. And these problems can be quite serious, with sterile drugs found to be contaminated with “glass shards, metal filings, and fungal or other contamination” according to an FDA report last month. 

Thanks to our partners who joined us in calling for increased safety of drug manufacturing: 

Action for Boston Community Development (ABCD)
AFSCME
Alliance for Retired Americans
Breast Cancer Action
California Alliance for Retired Americans (CARA)
Center for Medical Consumers
Community Catalyst
Connecticut Center for Patient Safety
Consumers Union
Families USA
Florida CHAIN
Health Law Advocates of Louisiana, Inc.
Illinois Public Interest Research Group (Illinois PIRG)
Medicare Rights Center
Mississippi Human Services Coalition
Missouri Alliance for Retired Americans
National Education Association (NEA)
National Labor Alliance of Health Care Coalitions
National Physicians Alliance
National Research Center for Women & Families / Cancer Prevention and Treatment Fund.
National Women’s Health Network
New Hampshire Alliance for Retired Americans
North Carolina Justice Center’s Health Access Coalition
Ohio Alliance for Retired Americans
Pennsylvania Public Interest Research Group (PennPIRG)
TeamstersCare  – Teamsters Union 25 Health Services & Insurance Plan
Texas Alliance for Retired Americans
UHCAN Ohio
USAction
USPirg
Vermont Public Interest Research Group (VPIRG)

In October, the FDA and manufacturers of finished generic drugs and ingredients (Active Pharmaceutical Ingredients or APIs) reached a ground breaking agreement that can (1) ensure the safety of generic drugs and APIs wherever they are produced globally and (2) ensure that new generic drugs become available to patients more quickly.

The drumbeat of manufacturing safety problems occurring in domestic and foreign plants that produce both brand name and generic pharmaceuticals continues must be addressed. In the last week, FDA has cited generic drug maker Mylan and German manufacturer Jenahexal for manufacturing problems, while Ranbaxy settled longstanding concerns in time to launch their generic version of the block-buster drug Lipitor.

Manufacturing failures can create obstacles to the ongoing availability of affordable generic drugs, or even serious risks to patient safety. Thus this new agreement (the Generic Drug User Fee Act or GDUFA) is critical. Addressing the lag in foreign inspections is especially significant, since 80 percent of active ingredients and bulk chemicals used in U.S. medicines now come from foreign countries. Currently, the FDA does not have the authority or resources to inspect all foreign suppliers of drug ingredients. Domestic plants are inspected by FDA on average every 2.7 years. The New York Times recently reported that at its current pace, the FDA would need 13 years to inspect every foreign drug plant exporting to the United States. 

The draft GDUFA agreement is a major commitment by the industry to solve this problem by “ensuring that industry participants, foreign or domestic, who participate in the U.S. generic drug system are held to consistent high quality standards and are inspected biannually, using a risk-based approach, with foreign and domestic parity.” The industry has backed up this commitment by agreeing to provide $300M annually in user fees to provide FDA with the resources to increase inspections and to speed the review of new generic drugs. The fees would supplement FDA annual funding. 
 
Guaranteeing the availability and safe manufacturing of generics is not only critical to patient safety, but also to access to care and to the financial stability of families, health plans and public programs. Today 78 percent of all prescriptions dispensed in the U.S. are generics. In 2008, the average cost of a generic drug was nearly four times less than the brand name equivalent ($35.22 vs. $137.90). Thus, while 78 percent of prescriptions are generics, the total spending on generics accounts for just 25 percent of the total U.S. drug spending, and generics drugs have saved more than $824B over the last decade.

GDUFA can play a role in solving the problem of drug shortages, as well. Shortages can be catastrophic for patient safety, and often affect generics since they account for 78 percent of prescribed drugs. Stepped up inspections at foreign plants can prevent manufacturing problems that can lead to shortages of medically necessary drugs. Health system pharmacists, who confront these problems every day, point out that “user fees can result in faster approval processes for generic drugs” while not sacrificing  patient safety concerns. 

The FDA-industry draft agreement is now being reviewed by the Office of Management and Budget. When approved, it will be sent to Congress for action, probably to be included in the renewal of the Prescription Drug User Fee Act (PDUFA), which deals with user fees for brand-name drug approvals.

- Marcia Hams, Director of Prescription Access & Quality

In less than a month, the FDA will convene a scientific panel to evaluate emerging evidence that some of the most commonly used contraceptives – Beyaz,Gianvi, Loryna, Ocella, Safyral, Syeda, Yasmin, Yaz, Zarah, — have greater risks than other similar products. Patients and their advocates are seeking court permission to have drugmaker’s internal studies released so that FDA can see the full picture.

These drugs all contain the hormone drospirenone, while other contraceptives use a different active ingredient — progestin levonorgestrel. The FDA reports that “all birth control pills pose a risk of blood clots” but a recent British Medical Journal (BMJ) study found that contraceptives containing drospirenone were “associated with a threefold higher risk of non-fatal [deep vein blood clots]” compared to women who do not use hormonal contraception, and twice the risk of competing drugs using a hormone other than drospirenone.

On December 8, an FDA panel will likely look at the body of evidence concerning this BMJ study, and other studies listed on the FDA website. This review might tip the scales enough to add warnings to the drug’s label. Yet it remains to be seen if FDA will see all the documents it should before making a decision.

About 10,000 patients who took Yaz or Yasmin are suing the drug’s manufacturer Bayer for failing to disclose an increased risk of blood clots, and their lawyers have asked the court’s permission to submit to the FDA hearing approximately 50 documents unearthed in that litigation. The lawyers describe these documents as “internal and candid memoranda of clinical trial data and adverse event data not [before] shared with the FDA [by Bayer]”, according to a brief filed in one lawsuit.

Many readers may recall that documents concerning the safety and illegal marketing of the drug Zyprexa, the widely used antipsychotic drug, were released a couple years ago, both by a doctor retained as an expert witness, and later by the Court. This information was invaluable in alerting the public to the increased risks of death when Zyprexa is used to treat vulnerable seniors suffering from dementia. Following the pattern we saw with the pain drug, Vioxx, in 2004 and the diabetes drug, Avandia, in 2010, the Zyprexa documents showed that in the interest of maintaining the sales of their block-buster drugs, drugmakers withheld critical information from the FDA and the public — causing the deaths of tens of thousands of patients, while leaving tens of millions at risk.

The hearing on December 8 is less than a month away. We hope FDA will make sure it sees any studies that Bayer’s scientists and expert consultants did concerning the risks of drospirenone before making a decision on how to best protect the public health.

And there’s a potential conflict-of-interest issue as well. Lawyers for the injured women are concerned that some of the 13 scientific experts on the FDA panel have financial relationships with Bayer. Under the FDA rules, members of scientific advisory panels must disclose their conflicts to the FDA, and must receive a waiver in order to participate. The advisory panel could recommend that the FDA add warnings to the labels, implement other safety protocols, or even to withdraw them from the market—it should be free of industry influence.

The FDA needs complete information to do a good job, and the public needs to know who ultimately participates or votes on the FDA panel to be sure we can trust their final decision. Every day women are barraged with slick TV ads for Yaz and other contraceptives. We deserve more than marketing buzz – we need an unbiased, transparent and scientific evaluation of the drugs that makes sure women are not knowingly put risk.

(Hat tip to Pharmalot)

– Wells Wilkinson, Project Director Prescription Access and Litigation &
Marcia Hams, Director, Prescription Access and Quality

Things are getting colder here in New England, and we’d been hoping for a little more Sunshine in October. That’s when HHS was supposed to issue rules implementing the Physician Payment Sunshine provisions of health reform.

The urgency was summed up by co-sponsor Sen. Chuck Grassley (R-Iowa) back in 2009: “Transparency fosters accountability, and the public has a right to know about financial relationships. Patients rely on their doctors’ advice. Taxpayers spend billions every year on prescription drugs and medical devices through Medicare and Medicaid. They also fund tens of billions of dollars of medical research each year, and the doctors conducting that research have a big influence on the practice of medicine.” For the last several months, Senators Grassley and Kohl (D-Wisconsin) have been urging HHS to issue regulations as quickly as possible to meet this need.

The Sunshine provisions require drug, device, biologics and medical supply makers to start submitting information to HHS on their payments to physicians, teaching hospitals and group purchasing organizations (GPOs) this January. That information must be available to the public on September 30, 2013 through a searchable online database.

We are increasingly worried that HHS delays could interfere with the process of collecting the most accurate, consistent and understandable reports from manufacturers, and that we and other interested parties will not have time to weigh in on the reporting framework that HHS proposes. Because of these concerns, we submitted a letter on October 20 to HHS Secretary Sebelius, along with Consumers Union, the Pew Health Group and industry itself – PhRMA, BIO and AdvaMed.

Early this spring, Community Catalyst shared our informal recommendations with HHS on how the systems could be set up to be most effective. We based our thinking on our experience with state disclosure laws and industry disclosures resulting from lawsuits and government investigations. Our top concerns are that:

• Reporting categories be defined in a specific, unambiguous, and mutually exclusive manner, so that data tells a clear picture of what these financial relationships are
• The public disclosure website be useful to all users, including lay consumers, physicians whose payments are being reported, and researchers interested in studying trends and impacts of financial relationships with industry

The Sunshine statute itself is much more specific than the state disclosure laws that it will replace. (Note: states can still collect other information not required by Sunshine, such as payments to nurse practitioners.) For instance, the Sunshine provisions lay out 14 descriptors for the “nature” of a payment, including, in brief: consulting fee; compensation other than consulting; honoraria; gift; entertainment; food; travel; education; research; charitable contribution; grant; royalty or license; ownership interest; and speaking for serving as faculty. States and industry data bases use many fewer, often ambiguous categories.

However, we have urged HHS to refine these definitions in regulation so that there is no confusion over how a company should report its payments. And physicians and teaching hospitals deserve to have the payment categories carefully described so they aren’t misinterpreted. The public needs clarity to assess whether certain payments might or might not affect the care they are receiving.

There are concerns by some over how the Sunshine disclosures will relate to other public sources of information on industry payments. These types of issues were front and center last week at a conference we attended on conflicts of interest, put on by the American Society of Law, Medicine and Ethics. The Sunshine law requires industry to report their payments to physicians and teaching hospitals, but physicians themselves must make disclosures about their industry financial ties to many sources, including academic medical centers, medical journals, NIH and FDA panels. There is the potential for confusion and misinterpretation of the data. Despite the challenges, Robert Steinbrook, MD from Dartmouth, and former deputy editor of NEJM, concluded in his presentation on COI and medical journals, that with the Sunshine provisions, “there should be additional opportunities to better control conflicts of interest in Medicine.”

Indeed, we believe the Sunshine provisions can set a national standard that will help in harmonizing all disclosure requirements and provide a useful cross check for physician self-reports.

– Marcia Hams, Director, Prescription Access and Quality
Community Catalyst

Senators Charles Grassley and Herb Kohl are two of the legislative champions of the Physicians Payment Sunshine Act, which was included in the Affordable Care Act (ACA) last year. They recently sent a letter to the Centers for Medicare and Medicaid Services (CMS), expressing “severe disappointment” about a major missed deadline that puts timely implementation of the legislation at risk.

We at PostScript join in their disappointment that regulations on the Sunshine Act have not yet been released by the CMS. We also appreciate the attention the Senators’ letter gives to the role for consumers and consumer advocates – these rules are ultimately for the benefit of health care consumers. We have a personal stake in knowing our physician’s potential conflicts of interest because payments from industry may affect decisions they make about our care, the affordability of our treatment and ultimately of our insurance premiums.

A Minneapolis Star Tribune editorial said it well:

“Some might be tempted to applaud the delay of any new industry regulations. That’s shortsighted. The Sunshine Act will require public disclosure of the large sums sometimes paid to medical professionals by industry. That collaboration is important for medical innovation, but there are also concerns about whether money influences doctors when it comes time to choose between new products and older drugs or devices. Payment information should be easily accessible so that patients can weigh for themselves if medical providers have their best interests at heart.”

To date, the independent, non-profit newsroom ProPublica has done their share to get the ball rolling. Combining industry disclosures required by Department of Justice lawsuits concerning illegal marketing (Pfizer, Novartis, Eli Lilly, Johnson & Johnson, etc), ProPublica has created an online database of payments to doctors from the 12 companies whose “combined prescription drug sales amounted to about 40 percent of the U.S. market in 2010.”

ProPublica has also helped journalists understand and publicize the importance of these payments through an ongoing series of news articles about industry payments to doctors. But as ProPublica notes, “physician payments from potentially hundreds of drug and device companies operating in the United States are still secret for the time being.” The Sunshine Act will not only provide transparency of payments by all companies, but make disclosures more detailed and consistent.

In April, CMS hosted an open door meeting by phone, where industry and consumers weighed-in on some important definitions that the Department of Health and Human Services (HHS) must clarify through regulation. For instance, how will industry draw the line between education and marketing? What kinds of research payments can be delayed, and which can’t? How the agency defines certain types of payments will have real impacts upon how the data is reported, and how useful it will be to consumers and others researching the effects of these payments. So the agency has its hands full.

Community Catalyst knows from our other work on many aspects of the ACA that HHS and CMS have their hands full implementing the biggest expansion in health care coverage and other improvements to the U.S. health care system in more than forty years. However, the Sunshine Act rules also need to come out soon, so the industry has ample time to implement systems to track all their payments starting January 1, 2012.

Here is a refresher on the timing of the Sunshine Act provisions:

• Spring/Summer 2011: The Secretary of Health and Human Services was “required to consult with the Inspector General, affected industry, consumers, consumer advocates and other interested parties to ensure that the information made available to the public is presented in the appropriate context.”
• October 1, 2011: Deadline for regulations that establish the procedures for applicable manufacturers to submit information, as well as procedures for making such information available to the public.
• January 1, 2012: Manufacturers begin collecting data for calendar year 2012. Duplicative state laws preempted (see Pew Prescription Project fact sheet).
• March 31, 2013: Manufacturers submit information to CMS on payments for calendar year 2012.
• April 1, 2013: Report to Congress on information collected from industry.
• August 16, 2013: Manufacturers and recipients have opportunity to review and correct posting prior to publication of the data, subject to subsection (c)(1)(D). Review period under (c)(1)(C)(ix) – cannot delay posting date.
• September 30, 2013: CMS to publish information on public, searchable website, and to send their first reports to states.

More about Sunshine? Check out the Sunshine Act Guide.

– Anna Dunbar-Hester, Program Associate and
Wells Wilkinson, Director Prescription Access Litigation